Payment in Lieu of Notice Calculator

Payment in lieu of notice is a sum paid by either the employer or the employee when the employment contract is terminated without the required notice period, compensating the other party for wages that would have been earned during that notice period. Under the Employment Ordinance, notice periods during and after probation differ, commonly seven days, one month or another period stated in the contract. If an employer dismisses an employee immediately without notice, payment in lieu of notice is usually required.

The calculation depends on the notice period unit. If the notice period is expressed in months, it is usually one month's wages multiplied by the number of months. If expressed in days or weeks, first calculate the average daily wage and multiply by the number of notice days. Average daily wage is often estimated as monthly salary multiplied by 12 divided by the number of working days in a year, which is conceptually similar to ADW.

HK FinBox's payment in lieu of notice calculator supports notice periods in days, weeks or months. Just enter your monthly salary, number of working days per week and the length of the notice period, and the calculator will convert these into an average daily wage and the total payment in lieu of notice. Whether you are an employer assessing termination costs or an employee checking your entitlement, you can get a quick reference figure.

Payment in lieu of notice should be no less than the wages that would have been earned during the notice period, including fixed salary and reasonably expected allowances. If the contract terms differ from the minimum requirements of the Employment Ordinance, the terms more favourable to the employee usually apply. In case of dispute, keep your employment contract, pay slips and dismissal notice, and seek help from the Labour Department or a legal professional.